Thursday, September 13, 2012

Judge agrees to hear Apple's FRAND defenses against Samsung on December 6

On Monday (September 10) I reported on Apple's motion for a separate briefing schedule and additional page limits for its FRAND defenses and a FRAND-based unfair competition counterclaim, and Samsung's opposition. In that post I also explained that there are some misconceptions out there regarding whether Apple's FRAND defenses failed at the recent jury trial. That confusion should go away now that Judge Koh has stated that her recent scheduling order, which already envisions a December 6 hearing on other post-trial issues, "did not foreclose the parties from bringing separate motions on equitable issues and issues of law not presented to the jury at trial".

The jury did not find Apple to infringe any of Samsung's patents, including the two standard-essential ones. Non-infringement is a complete defense. It furthermore supported Apple's patent exhaustion argument with respect to the Intel baseband chips at issue. Patent exhaustion, too, is a complete defense. So Apple is presently twice safe from those particular SEP assertions, and Samsung would have to overcome both successful defenses with its Rule 50 ( overrule-the-jury) motion. That's not likely, but not impossible. And at any rate, those FRAND issues are of fundamental importance since Samsung is also asserting SEPs against Apple in other U.S. lawsuits (the second California litigation as well as an ITC investigation). Apple must fight for those FRAND defenses, and as I explained on Monday, those defenses can still succeed even if the court declines to overrule the jury on a couple of FRAND counterclaims. There isn't enough of an overlap of the relevant legal tests that a finding against those particular counterclaims would imply the failure of the affirmative defenses.

Formally, Judge Koh granted Apple's motion "in part", but the only modifications of Apple's proposal are that she reduced the page limits (12 pages instead of 20 for the original motion and Samsung's response, and 7 pages instead of 10 for Apple's reply) and, despite adopting the proposed hearing date, set a much tighter schedule for Samsung's opposition brief and Apple's reply brief. I've created a simple table that shows the difference:

ItemApple ProposalCourt Order
(motion + 4 weeks)
(motion + 2 weeks)
(opposition + 3 weeks)
(opposition + 1 week)

The tighter schedule doesn't prejudice the parties. It's just tougher on their legal teams.

Another difference is unrelated to what Apple asked for in its motion. Samsung gets the same page limits and schedule to raise its own non-jury claims, the most important part of which are its indefiniteness defenses against a couple of patents. Apple disagreed that those were equitable issues, but again, Apple's motion was all about getting additional briefing space on FRAND and properly separating FRAND defenses that have not yet been decided in the first instance from Rule 50 matters on which the parties ask the court to overrule the jury verdict.

If Samsung had a strong indefiniteness argument, Judge Koh would have thrown out the relevant Apple patents ahead of trial. It won't be easy for Samsung to prevail on them now. But there continues to be parity in terms of page limits and most of the scheduling issues, which seems fair but actually isn't, given that the parties' post-trial needs are disparate. This hurts Samsung a lot in the Rule 50 context, where I wonder how it will really be able to challenge hundreds of jury findings on 30 pages (no matter how well it aggregates and condenses the issues), while Apple only has to challenge a very limited number of findings (mostly the tablet design patent thing and a couple of FRAND counterclaims), and it's against Apple's interests with respect to the timing of potential injunctive relief. Also, Apple's pursuit of its non-jury claims would deserve more space than Samsung's indefiniteness theories, which a stricter court would have deemed resolved or waived by now. The fact that Apple, not Samsung, brought a motion for additional page limits for non-jury claims shows that this really matters to only one party and the other just made its own equal-treatment request in response.

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